Blogger Q&A: How I'm teaching my kids about money

By Emma Lunn

Financial education is the subject of
much debate at the moment, with many pundits calling for personal finance to be
taught in schools.

In fact, statistics cited by the Personal Finance Education
Group (PFEG) tie early formal financial education to a slew of things that
are good for society. Those who took a personal finance course are more likely
to plan for retirement, pay
credit card bills on time, complete income tax returns correctly and seek
financial advice when they need it, PFEG claims.

Yet even those pushing for money management
classes in schools can probably agree that money education begins at home --
and that parents can teach (for better or worse) by example.

We spoke with Fiona Service, a self-described
"hippy mum struggling through life on a budget" who writes the Budget Mummy Blog. She shared some of
the admittedly tough yet age-appropriate money lessons she's teaching her
8-year-old son and her 6-year-old daughter.

UK.CreditCards.com: What questions are your kids asking about money? How do
you answer?

Fiona Service: Why does that machine give you money,
mummy? Can we just get lots out?" And, "When Daddy gets a new job and
we have more money, can we not eat pasta?"

We are very frank about money and tell them exactly
the situation (age appropriate, of course). We feel that we have to deal with
things as a family and that they should learn just how it is.

UK.CreditCards.com: What's your tip for making learning about money fun for
kids?

Service: We have a money counting jar -- the children earn
money for chores, or exceptional behaviour or achievements. They also lose
money for bad behaviour. They love putting the money in and see it go into the right
slot and bring their total up.

UK.CreditCards.com: At what age do you recommend teaching your children
about money? How does this change as they get older?

Service: We started as soon as they were aware of money
(about 4 years old). We are discussing more about saving their money up for
things and thinking hard about what they are buying -- is it worth it?

UK.CreditCards.com: How do you teach your kids about saving what they earn?

Service: We discuss saving by pointing out that if they want
that particular thing, they need to save for it. We celebrate when they have achieved their goal and really highlight it.
We also discourage them blowing their money on silly things.

UK.CreditCards.com: Do you have any concerns about your children's attitudes
about or understanding of money?

Service: I wish I didn't have to be so tough on my kids
about money. But as we live on a very tight budget and I really want them to be
prepared for life, we really make the effort.